Survey says consumers want online orders shipped fast and free

Discussion
Photo: @isunwater via Twenty20
Nov 01, 2019
George Anderson

A new survey of 2,500 consumers in the U.S. finds that those shopping online for gifts heading into the holiday season don’t simply want free delivery, they also want their orders delivered quickly.

The research, part of a third annual report from Convey, found that “cost” was the most important factor related to shipping. It was cited by 64.3 percent of respondents, followed by “speed” at 18.7 percent. The number of people pointing to delivery time as important nearly doubled from last year when 9.7 percent gave that answer.

Estimated delivery dates play a role in shopping decisions with 28.6 percent saying they are more likely to place an order that arrives within a week. Only 7.5 percent said that shipping dates do not affect their purchasing decisions.

Free two-day shipping, what many see as the norm of online retail, was important to 79.3 percent of those surveyed. In-store pickup, as a point of comparison, was important to 30.8 percent of respondents.

Delivery is a critical factor when it comes to the online shopping experience. Nearly 84 percent said that delivery is important in this regard, up from 73.6 percent last year. And not getting delivery right is a business killer, with 72.7 percent saying they are unlikely to do business with a site again after a poor delivery experience.

Whether packages are on time or running late, consumers want to be kept in the loop. This is especially true of late deliveries as 98.3 percent say they want notification if a package is held up, up from 87.8 percent in 2018.

Much of the changes in consumer attitudes about shipping seem to have been driven by Amazon.com’s delivery practices, which now offers Prime members free next-day delivery on millions of products sold on the site as well as free two-hour grocery deliveries.

“For brands that like to think they aren’t competing with Amazon, the data clearly suggests that shoppers think they are,” said Kirsten Newbold-Knipp, chief growth officer at Convey, in a statement. 

Retail chains, including Best Buy, Target, Walmart and others, have all responded with faster, free delivery options to rival Amazon. 

DISCUSSION QUESTIONS: Do you agree that many consumers measure the delivery performance of other retailers based on their experiences with Amazon? Has the free and fast delivery of online orders become table stakes for all retailers?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Brands who seek to make people’s lives easier, help them do things faster, and/or save them money will be rewarded. "
"It’s now all about removing “friction” both in-store and when delivered. Delivery friction includes cost, timing, and anxiety..."
"Shoppers have come to expect free and fast shipping and as Amazon continues to raise expectations, its competitors will need to be prepared to follow."

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29 Comments on "Survey says consumers want online orders shipped fast and free"


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Mark Ryski
BrainTrust

Amazon sets the delivery standard with which all others will be compared. Fast delivery has indeed become table stakes and Amazon continues to push the boundaries of what’s possible. No doubt other major players who have the financial wherewithal to play the profit killing next-day delivery game will match Amazon – most other retailers can simply watch and wonder.

Chris Buecker
BrainTrust

Absolutely. Shoppers have been spoiled. And once spoiled, they do not like to go back. Amazon sets the bar higher and higher and are top of mind for shoppers. That doesn’t change even if the retailer might not be a direct competitor to Amazon.

Ian Percy
BrainTrust

You said it exactly right before I could, Chris. Consumers are like spoiled kids. That doesn’t usually turn out so good for anyone. And guess whose fault that is?

Zel Bianco
BrainTrust

Yes they do. And it is unfair to other retailers and makes the playing field very uneven. Consumers are ridiculous sometimes as well. If you ordered something that is critical – and must arrive quickly, OK, that should be expected and may cost a few bucks to have it arrive overnight. But gifts for the holiday season? Why is this critical? Order them, have them arrive in let’s say two or three days and then even if they got the order wrong, there is still time to get it right. I think that sometimes we have become so needy that if we don’t get immediate satisfaction, we become cranky. How are most retailers expected to compete with Amazon and still make money?

Jeff Sward
BrainTrust

Amazon’s execution plays a huge role in setting expectations for how everyone else executes online orders. It’s their primary competitive weapon and they leverage it at every opportunity. Amazon makes an announcement and everyone else reaches for the aspirin and antacid.

Peter Charness
BrainTrust

The Amazon experience (free fast shipping, easy returns) has set the bar, athough in reality Amazon has buried the cost of “free and fast” in a Prime membership fee, which is barely remembered when that “buy now” button is pressed for each transaction. Other retailers have to bury these costs more in plain sight, likely in the product’s retail price, or spreading it through a minimum basket value. It’s not a level playing field, but it is table stakes today.

Tony Orlando
BrainTrust

Of course consumers want “free” everything, and they want it yesterday. Was this survey a surprise? Consumers today believe Free shipping is part of the online transaction, with no clue on how much it actually costs, and they want free returns with zero hassles, and same-day or one-hour delivery windows on everything they buy. For those who think this is how it should be, fine — but the cost of delivery has to be built into the transaction, or no one will make a profit. In the grocery business, I could not operate under these new mandates for delivery and would be broke in six months. There are no third-party delivery services anywhere within 50 miles of us, as I looked into it. So for now, Walmart and Amazon keep on winning in the rural small towns.

Paula Rosenblum
BrainTrust

We did a study on home delivery way back in 2015, and even then consumers weren’t keen to pay for shipping and felt no need to pay to get things faster.

Still, we don’t always need everything right away, so it’s not always a punishment if a retailer can’t deliver in two days.

Ed Rosenbaum
BrainTrust

Thank you Amazon! Yes, Amazon spoiled us with fast and free delivery. Now the rest of the commercial retail world has to do the same or we will not be happy. Of course, now we have been trained to expect fast and free delivery. But the downside of it is someone is going to have to pay for it. Free is not free to someone in the chain from manufacturer to consumer. Was anyone surprised by the results of this survey?

Michael La Kier
BrainTrust

Brands who seek to make people’s lives easier, help them do things faster, and/or save them money will be rewarded. However, once expectations are set, they continue to rise, mostly driven by an expectation of convenience. Amazon has set the bar with fast, free delivery and this is now the standard…until it can be done faster.

Cathy Hotka
BrainTrust

Of course they want fast and free shipping. And if you asked them whether they’d want products to be free they’d say yes to that, too. The challenge for retailers going forward is to balance customer expectations with the necessity of remaining profitable, which is no easy feat when the competition is subsidized by its cloud business every year.

Verlin Youd
BrainTrust

Right on the nose Cathy, “And if you asked them whether they’d want products to be free they’d say yes to that, too.”

Ken Lonyai
BrainTrust

If it’s readily available, who wouldn’t want any perk they can get including fast and free shipping? The reality is (as many have said here over the years) free shipping is an illusion that’s rolled into the price of goods. Elevating shipping to faster and faster intervals increases the cost of logistics/inventory management/shipping that consumers will be paying for as well.

All that really happens is smaller businesses without scale get made more uncompetitive and eventually fade away. In time, that allows the remaining “at scale” players to creep selling prices upwards and hide the cost of fast/free shipping right under consumers’ noses.

Shoppers: be careful what you wish for.

Jeff Sward
BrainTrust

Very careful indeed. It’s always interesting to watch an unsustainable scenario play out.

Verlin Youd
BrainTrust

We watched it play out with Walmart, disrupting the prior retail model and leaving a lot of less efficient retailers in their wake, as they delivered ever increasing value to consumers. It appears Amazon is doing the same. Some may say it’s unsustainable, but it sure has been going for some time and continues to get better and better for consumers. And all the while, Amazon is making their supply chain more and more efficient.

Neil Saunders
BrainTrust

Delivery is a service that forms part of the online transaction so in the minds of consumers it is an integral part of their purchase. However, that service is not free: it comes with a variety of costs attached such as handling, packaging, and shipping. These costs are increasingly being subsidized or paid for by retailers, with a resultant impact on their bottom lines. This survey underlines the challenge of reversing that position. Essentially, customers are being given something for nothing. That can’t now be taken away without considerable consequence.

Steve Montgomery
BrainTrust

The short answer is yes. Amazon has been setting the bar for delivery standards for some time. Each time it raises the bar it forces others to try to match it if they can. The development of its own delivery ecosystem makes it harder and harder for others to play catch up, but they know if they don’t they will lose sales and customers.

Rich Kizer
BrainTrust

Ship fast, ship free. These have certainly occupied our conversations as of late. It’s kind of like this: When a customer experiences a wonderful service, they become conditioned to always expect it. When the battle ground for the customer becomes free and fast delivery, that transitions the delivery question from a “wonderful experience” to “expected” and “demanded.” Table stakes? Yes, indeed.

Richard J. George, Ph.D.
BrainTrust

Yes and yes. Like the cat who tasted fresh tuna there is no going back to canned tuna.

Ian Percy
BrainTrust

Just a thought…

In some situations doing the opposite of what everyone else does pays off big time. What if someone flaunted the idea that reasonably-timed delivery (a week perhaps) is actually more economical, just as convenient and goods will arrive more carefully packaged rather than thrown in a box five times bigger than needed? For example, when I see a sign for a “Quick Shoe Shine” and see they use an electric polisher, I won’t stop. If I saw “Shines done totally by hand, 10 minutes for a quality shine” I’d stop if I was wearing sneakers.

Likewise, do I want dinner served to me 60 seconds after I order it? Whisky or wine bottled yesterday? “Fast and free” is a totally overrated gimmick!

Ryan Mathews
BrainTrust

Do they want fries with that? Look, this is what is known in the complex world of sophisticated high wire statistical analysis as “Conformation of the Obvious” — or the ability to prove through survey that which is already known by experience, observation, and fact. The answer to almost any question involving improving shopping is, “cheaper — free being the best option — and faster.” Not a huge surprise. Even less of a surprise when, as I’ve been observing here for what seems like forever, retailers sacrifice margins in a fruitless attempt to build “loyalty” by giving away as much as the next company. Did Amazon start it? Sure … but who cares? The “Free” Delivery Genie is out of the bottle — and margins will never be safe again.

Ralph Jacobson
BrainTrust

Is there a surprise here? Sure the majority of people want free stuff, like college, healthcare or shopping purchase delivery. It’s interesting, though, that less than 20 percent care about the speed of delivery. Bottom line, determine your COGS and make delivery “free” as you absorb those costs into your selling price and services offerings.

Shikha Jain
BrainTrust

The baseline keeps shifting. On the one hand, retailers are constantly trying to outdo one another to deliver quality service and shopping experiences and then, on the other hand, consumers get used to it and demand for it to become the “new normal.” Retailers can sometimes get stuck in a never-ending cycle of trying to top one another.

Verlin Youd
BrainTrust

It’s now all about removing “friction” both in-store and when delivered. Delivery friction includes cost, timing, and anxiety created by either delivery delays or perceived possibility of problems with delivery. I’m going to sound like a broken record here, but really can’t say it better than was quoted above, “‘For brands that like to think they aren’t competing with Amazon, the data clearly suggests that shoppers think they are,’ said Kirsten Newbold-Knipp, chief growth officer at Convey…” Amazon continues to set the pace in frictionless commerce.

Liz Adamson
BrainTrust

Amazon has certainly set the standard with free two-day delivery for its Prime members, and are raising that bar with their recent change to one-day delivery. Shoppers have come to expect free and fast shipping and as Amazon continues to raise expectations, its competitors will need to be prepared to follow.

Steve Dennis
BrainTrust

No one needed a study to know this.

Doug Garnett
BrainTrust

Ah, what tangled webs we weave for ourselves. Amazon establishes economically unsustainable expectations among consumers because their investors are willing to allow it to happen. Then the rest of retail has to follow suit.

I’m reminded of the early US cell phone wars where the phone was free. It set expectations among consumers which couldn’t last. It also set up tremendous dissatisfaction with cell companies (because it forced long term contracts).

Truth is, Amazon is beginning to suffer from it’s ability to offer these things — I’m hearing more Amazon shipping dissatisfaction — when they miss, when there’s confusion over what IS overnight shipped, when they blow an order, and when they box one simple product in a massive complex of wasted packaging.

Some retailer will build tremendous brand value by explaining shipping costs and making it all become rational for consumers. But it will take courage to make it happen.

Bagrat Safarian
Guest

Amazon is again playing the long game. They know competing retailers will eventually need to either charge for the delivery service or raise prices, which may alienate customers visiting the stores. There are a few holes in the Amazon strategy that traditional retailers can take advantage of, like value adds for coming into the store and loyalty incentives for building market basket size.

Cate Trotter
BrainTrust

Is anyone surprised by this? Just because they’re buying online doesn’t mean customers are any less impatient to get their products. They also don’t want to pay more for them (i.e. for delivery) — that charge can be the thing that pushes a purchase price up too much for them to actually want to make it.

For retailers it’s a challenge certainly, and I do think a lot of customers do use Amazon as a benchmark. A huge proportion of regular online shoppers have shopped at Amazon at least once before and that experience will probably have helped cement their expectations. Couple that with the fact that Amazon always seems to working to make things faster and you’ve got an ever moving goalpost.

I think all retailers have to be looking at customer wants when it comes to delivery and finding ways to try and meet them (without crippling themselves in the process).

wpDiscuz
Braintrust
"Brands who seek to make people’s lives easier, help them do things faster, and/or save them money will be rewarded. "
"It’s now all about removing “friction” both in-store and when delivered. Delivery friction includes cost, timing, and anxiety..."
"Shoppers have come to expect free and fast shipping and as Amazon continues to raise expectations, its competitors will need to be prepared to follow."

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